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Dan Gilbert, founder and chairman of Quicken Loans, the third-largest U.S. mortgage lender, is teaming up with upscale watchmaker Shinola to build the 130-plus-room hotel with about 17,000 square feet of retail space.

Mr. Gilbert’s Bedrock Detroit, the development arm of his family of companies, is credited with helping to revitalize Detroit’s city center by moving thousands of his highpaid employees there and redeveloping mostly vacant skyscrapers into high-tech offices.

Shinola was founded in 2011 in Detroit’s College of Creative Studies with a mission to bring manufacturing jobs back to America, albeit on a much smaller scale than the industrial barons of old. The company has retail locations from Palo Alto, Calif., to Toronto, with most watches selling for $475 to $1,500. It employs about 530 people, of which about 400 are in Detroit.

Executives at the two companies got together a few years ago and decided that they could further the redevelopment of the downtown Detroit area by teaming up to build a new hotel, which will combine Mr. Gilbert’s eagerness to redevelop vacant buildings with Shinola’s pared-down aesthetic.

Their aim is to create a vibrant lobby that can act as a cultural hub for downtown, which is seeing an influx of luxury apartments and office workers.

“We really need a boutique hotel where you can hang out on the ground floor and have these unique experiences on the site,” said Dan Mullen, an executive vice president at Bedrock Detroit, Mr. Gilbert’s development firm.

Mr. Mullen declined to say how much rooms will cost per night, but said it would be a high-end hotel.

The design will combine several vacant historic buildings, along with a new addition and an alleyway with everything from art galleries to noodle bars.

The Noho Hospitality Group, owners of Joe’s Pub and Locanda Verde in New York, will run the restaurants on the site.